Starting July 1, central government employees and pensioners who receive salaries and pensions based on the 7th pay commision will be eligible for full Dearness Allowance (DA) benefits. Central employees currently receive a 17 per cent DA. Last year, the Union Cabinet authorised a 4% rise in DA for government employees, bringing the total to 21%. This was supposed to take effect on January 1, 2021. But due to the current COVID-19 issue, the Ministry of Finance agreed to freeze the increase in dearness allowance (DA) for over 50 lakh Central government employees and 61 lakh pensioners until July 2021. Due to the coronavirus epidemic, the three instalments of Dearness Allowance and Dearness Relief due to central government employees and pensioners on 1.1.2020, 1.7.2020, and 1.1.2021 have been delayed.
Finally, there is good news for lakhs of Central Government employees as under the 7th pay commision, the government is going to increase the dearness allowance (DA) of employees from July 1, 2021. It is expected that the government will also increase the dearness allowance from 17 percent to 28 percent from July 1.
Last year in April, the Union Ministry of Finance had decided to put on hold the increment in dearness allowance (DA) for over 50 lakh Central government employees and 61 lakh pensioners till July 2021 due to the COVID pandemic.
Currently, the DA is paid at the rate of 17 percent. However, it would now include a four percent increase from January to June 2020, a three percent increase from July to December 2020, and a four percent increase from January to June 2021. This means the total will be 28 (17+4+3+4) percent.
As per the pay matrix of Central government, the employees are now getting only Rs 18,000, as per a Zee Business report. And in their salary, a 15 percent dearness allowance is also expected to be added, which will translate to an increase of Rs 2,700 per month in their aggregate salary. And when their annual DA will increase, they will get Rs 32,400 per month.
After the salary is fixed, allowances like DA, TA, HRA, Medical reimbursement are decided. Dearness Allowance(DA) is fixed twice a year, i.e. from January to June and then from July to December.
DA is decided on the basis of average inflation in 6 months.
